Foreclosure Eviction: How Roommates in Chicago Can Protect Themselves

After a long and gruesome move, you’ve finally just settled down into your new apartment in Chicagoland. As you plop down onto the couch and kick up your feet to unwind, a foreclosure is the furthest thing from your mind. You signed a lease — you can’t be kicked out unfairly, right? Even the most seasoned renting veterans, who will take the extra precaution of purchasing renters insurance, aren’t secure if their building is under foreclosure. Currently, there are more than 15,000 properties in Chicago under foreclosure, according to RealtyTrac data, making Chicago one of the top markets for foreclosed buildings. It’s not uncommon for a renter to be unaware of their landlord’s financial situation — all the more reason for renters and roommates in Chicago to know their tenants rights. So whether you just moved in or have been around a while, foreclosures happen. Here’s what roommates in Chicago need to know about and what they can do to protect themselves from foreclosure eviction.

How Roommates in Chicago Can Protect Themselves From Foreclosures

Recent Numbers

Here’s one bit of good news for roommates renting in Chicago: Scary numbers and all, foreclosures are at a nine-year low according to recent data. Renters can breathe a small sigh of relief with the hope that the housing crisis is beginning to subside. In spite of the promising trend, foreclosures are something to be aware of. Roommates should continue to keep their Spidey senses on alert for warning signs that something may be up.

3 Warning Signs of Foreclosures

It’s a nightmare as a renter to pay your rent on time each month only to find out your landlord hasn’t been paying the mortgage by way of an eviction notice. There are laws in place to protect renters if this happens (more on that below), but staying ahead of the game is key. Knowing the red flags that your landlord isn’t making payments will give you more time to prepare and make your next move. Here are three key warning signs your landlord may be facing foreclosure to keep in the back of your mind.

1. Your Landlord is Out Of Touch

If you have a normally responsive landlord who is out of reach lately, this should definitely raise a brow. Also, if a property owner is slacking in regular maintenance or repairs and, again, won’t respond to your requests to get them done, then it may be time to investigate. Some local newspapers print lists of bankruptcies that you can check out if you suspect your landlord is in trouble, or do a quick search online typing in your building’s address and the word “foreclosure” to see if it pops up for sale on any websites. (Often, popular real estate sites will have their own section for these types of sales.) If you get a match, make sure it’s a current listing. Then, skip ahead in this article to the section on what to do next.

2. Your Utilities Are Shut Off

You’ve been paying all your utility bills on time to your provider but suddenly find them not working. (Also, make sure your roommate actually paid the bills if you’re not the one in charge of this task.) If you’re positive you’re not in the wrong, call the provider immediately, and ask them what’s up. They’ll let you know if a master account from the building has made any changes and perhaps why.

3. You Start Getting Unaddressed Mail

We’re all used to the stream of mail from previous tenants, but if you all of a sudden start getting mail that’s addressed to no one in particular, pay attention. Open all mail that may be addressed “Occupant”, “Unknown occupant”, “Current resident”, or the like. These may contain important information about any eviction notices or property changes that will save you from any more sleuth work.

Protecting Yourself

Once you and your roommates are certain your property is in foreclosure, find out the foreclosure timeline in your county. In states like Illinois, the timelines can vary by county, so it may require some quick research on your end, advises Wendell De Guzman, CEO of PCI Real Estate Investments.

“Cook and Will counties have longer foreclosure timelines than Dupage county, for example. Also, it depends on the time between when the property is foreclosed and the time when the renter has to move also varies by county.”

Depending on the county, you may have up to 90 days before being evicted. The seasonal time plays a major role in when you have to leave officially.

“In Cook county, which is very tenant friendly, one cannot be evicted during the winter months,” adds Guzman.

Renters in Cook county are safe from being forced out under these circumstances from December to February.

Once you have a concrete timeline by which you need to leave, you can begin a new housing search. The harsh reality is you do have to leave, but make sure to take these steps to ensure you’re not cheated or held unfairly responsible for any fees owed by your landlord. If you can afford it, hire a lawyer to fully understand your rights.

1. Keep Your Records in a Safe Place

Make multiple copies of your lease, security deposit receipts, and proof of rent payments. Don’t forget to note any attempt to make payments to a landlord who is not responsive. When protecting yourself from foreclosure eviction, this is absolutely key, says Guzman.

“Keeping good records and seeking legal help are two of the most important things a tenant can do to protect himself.”

2. Look Out for Fraud

Be aware the possibility of devious people claiming to be the new landlord. Don’t hesitate to contact law enforcement authorities if you suspect a scam. Your eviction notice should have contact information where you can find out more if you’re unsure of something.

3. Explore New Ownership Options

Another option renters can consider is actually buying the house. If the property being foreclosed on has a Federal Housing Administration loan, the renter can actually request Fannie Mae to become the new owner. Instead of Fannie Mae foreclosing on the house, it becomes the new landlord and the tenant does not have to move out, explains Guzman.

Another option that renters can take to avoid moving after a foreclosure is seeking out companies like PCI to buy the property and take over the official landlord duties.

“PCI is a cash buyer so it can acquire properties quickly preventing the house from being foreclosed on. With these two options, the renter does not have to move out. If the renter can prove he has been paying on time, Fannie Mae or a real estate investment company like PCI will be willing to have the renter stay at the property,” he adds.

For roommates in Chicago and many other cities, foreclosures are a real possibility, often overlooked. Remember, a lease and renters insurance can only protect you so far. When you’re renting, you don’t get to make ultimate decisions, but you can protect yourself!